Why Most People Will Use Blockchain Without Knowing It

Transcript

AI is the new UI. And AI is going to come and save the whole crypto industry in terms of the user experience. Hello everybody. Today with me I have a very interesting and exciting guest. I have William Mougayar. Mougayar. We're going to be talking about things that are a little bit deeper into the chain in this respect. What I really am interested is is you've been through 30, 40 years of research. I want to know exactly what it is What is it that fascinated you about blockchain

technology and when did you first hear about it? Sure. First, I've been in technology for four decades. So, I've had the opportunity to see different cycles come in. And my first interaction with something that was close to what the blockchain is about today was around the year 2000 when peer-to-peer file sharing was very popular. And that was the time when we started to see what can be done when peer-to-peer technology could replace intermediaries in the middle. And the idea was that music could be shared or files and data could be shared one-to-one. And then nothing happened for a while and then Bitcoin happened and Ethereum happened. And I got

involved with Ethereum day zero just when Vitalik was finishing his paper at the end of 2013, early 14. When I saw that, I put two and two together, I realized that what was going to happen here we were going to add file sharing technology, peer-to-peer file sharing. We were going to get into the second wave of digital cash, which I which I had seen early on with the internet but didn't go anywhere. And now we could do that. We can have real digital cash. We can have real peer-to-peer exchange of value and it dawned on me that the blockchain technology was going to be extremely important for the whole world going forward and then I started to immerse myself into

trying to understand it and my job mostly is an interpreter of technology into the business world. So what I do is to try to explain the impact of the technology to a business audience specifically. That's actually very fascinating. I I can appreciate so back in the days of file sharing through Kazaa and all of those I actually I I was very active. What was unique about that it was almost like an element of starting where there'd be these files that would otherwise be fractionalized and then at that stage do you feel that the file sharing do you feel that that method was necessitated by lack of bandwidth environment or what do you feel was it

that otherwise really made that kind of be the first step into your echelon of going into the blockchain and everything else? Well what what killed file sharing back then it was Napster what killed them was the government. The issue was that it had a good use but unfortunately Napster started to get used for illegal copyright infringements. So the music industry rallied and lobbied the government to have them kill Napster. So what they did there is that they threw the baby with the bathwater basically and they they killed the technology and they killed the use cases instead of saying no it's a good technology let's let's fix the use cases instead. That's why it died completely

for 10 years we didn't hear about it until Bitcoin came along and the Satoshi paper deep in there there is peer-to-peer technology. What's fascinating about what you say is is like at the end of the day it's all data transference right? We're what is what that data is and and it's perceived as value as well as a trust mechanism. >> that is the key. The The uh innovation is no intermediaries in the middle. And that's where oftentimes when you get it rid of those intermediaries and you lose those guardrails, that the unethical elements of a technology can come in. It's almost like there's a percentage of error that can always be there that will otherwise be used for nefarious means in that respect. So, when it comes to blockchain and how you've done your research and so forth, I almost feel

like the ones that are most versed in the technology almost become translators. You said that you explain business or you explain to businesses blockchain and so forth. How would you explain to a business that otherwise could greatly benefit from blockchain, how do you put it into the terms that otherwise they can understand that it's more than just a digital pyramid scheme, but that it's a trust mechanism? Well, you have to see the market into uh being in two segments, okay? The The big companies are not going to shoot themselves uh in the head.

They are going to shoot themselves in the foot. Which means that they will be okay with a little bit of change, with a little bit of improvement. So, they see the blockchain as a technology means to an end being maybe faster transactions, cheaper transactions, less complex processes that they have. So, the big companies do not see the blockchain as a revolutionary technology. They see it as a stepwise improvement technology. That is fine. We need a lot of these use cases and there are lots of places that the blockchain can insert itself and replace these 20, 30, 40, 50-year-old processes that need to be changed. And that's one side

of the use cases. The other side of the use cases is the more innovative uh stuff, stuff that we could not be doing before without the blockchain. And the analogy is the same thing happened with the internet. When the came along, the first thing people started to do is to copy stuff that they were doing, but they did it online. So, there was no innovation. So, we said, "Okay, we're doing it this way, and now let's do it this way online." But, that wasn't enough. The innovative part happened later when we started to do things that we could not do before without the internet. And the same thing is happening gradually now. Like, we have decentralized finance, for example. It's a totally different ballgame, totally different segment.

It does take some of the traditional finance, but it puts a whole new veneer around it, and it brings new ways of doing finance, lending and borrowing, and creating new instruments, basically, for investment purposes that we could not do with the current system. So, decentralized finance is one example of a an application that we could not do without the blockchain. There are other areas that are emerging. I still believe that we're going to see a second coming of NFTs, non-fungible tokens, that will be more useful than the first wave. I'd like to be able to animate my NFTs and make them do stuff, for

example. We're barely scratching the surface of the creator economy, being able to own digital goods, and being able to earn based on our involvement in the digital world, maybe by sharing our data, or maybe by sharing our knowledge. All of that is still a little bit further ahead. And we still are waiting to get more into the governance aspects of what the blockchain can do. So, the blockchain is a governance enabler. So, you hear about uh decentralized autonomous organizations, which is a buzzword for saying that let's insert the blockchain as an enabler of

mechanism as a mechanism enabler for how people make decisions. Uh and it's still kind of works in progress. I wouldn't say that we've nailed that perfectly as far as what the owls could do, but there are other emerging uh areas that the blockchain needs to to to push on that have nothing to do with the corporations, rather it has to do with creating new kinds of startups, new kinds of companies that we did not have before and that's really the the calling of the blockchain. It's not to replace existing systems, it's rather to create to create new ones that we did not have before. It's actually very There's a few

things that you mentioned that are really fascinating me. A couple of them just diving in when it comes to blockchain and NFTs specifically I found very interesting because the way I look at things, blockchain is like an honesty mechanism in which humans I feel to be pretty much the only non-binary factor in this universe. We take many inputs and then we're we can arguably be one of the only random things in this universe where you don't know what a human will do or operate and code and blockchain keep us honest to an extent. Now, when it comes to NFTs, the one thing that I think that we're running into with AI is is that human origination is going to become a scarce asset in that respect. We're going to have difficulty distinguishing what energies or anything is created

from a human or what derived from a human. So, what I find in some ways is that blockchain, what I'm curious of, do you feel that there's going to be some sort of an interweaving when it comes to agentic automations and so forth where perhaps there's an NFT component that could be arriving where it's going to be able to determine what originated from a human or what originated from an agent and have you done any research in that area? Definitely. That's going to be a whole chapter in my upcoming book called Trust Shift Ethereum and the reinvention of trust. So, AI is the new UI.

And AI is going to come and save the whole crypto industry in terms of the user experience. A regular user is going to have currently difficulties in working with a wallet. Most wallets are very difficult to use. And uh that has been a stumbling block in uh growing the market. Uh maybe we have 20 million users, 50 if you want to push it, but that's not nearly enough. The potential of having a billion or 2 billion users get involved with the blockchain.

But AI with the agentic types of queries and agentic types of interactions is going to bring down the difficulty level of blockchain, of crypto wallets. All of the use cases will have a AI interface that is more like a natural language way of interacting with the technology. And it's going to open up a lot of venues. It's going to bring new users into the space. Do you feel those users might not even know that they're using blockchain? Do you feel that's going to be the simplification layer?

>> Exactly. They'll be able to interact at the as they do with ChatGPT or Claude or Gemini by just asking questions and saying, for example, I have $1,000. I would like to invest it with this following strategy, with this following risk factor. What do you recommend? How can I do this? And you just connect your wallet, for example, or even the agent will will take care of it and they'll give you strategies or they'll do it for you. And you can say, I want to sell if I'm up 20% or whatever. You You just describe your needs. Yeah. And the agents will do the job. And that will bring a lot of users into the industry.

I'd say it was actually I really agree with that. I have one other question that I want to ask you and it's related to what I see is the a barrier in this industry and and there's perhaps not a solvent to it is the KYC barrier. You see Worldcoin doing redness scanning, you have biometric scanning to be able to determine if somebody's a true human versus AI or even just a bot or somebody that's doing anything that otherwise is not human oriented. Um do you from your research, one thing I've been looking towards and one thing I've seen develop is a reputation-based system, some sort of an algorithm that will ultimately give a greater likelihood of proving humanity or proving that this is an authentic transaction in that respect. Do you feel

that there's a world where there's some there's an algorithm that will be able to determine true human versus AI or versus manipulation? Um and do you think that that's going to be something that circumvents the requirement for KYC or do you feel that it's going to be something that is paired with one one another? Like there has to be a balance of both. That's definitely an area that is going to be important. What is missing right now in the overall is user agency. Meaning that we want autonomy in terms of our own identity, our own data. Right now we give that to Google. If you want to go and sign on to any website, typically you use Google to sign on, you use Facebook to sign on or Twitter, X. But what

shouldn't be that way because what we are doing is we we are lending our identity to these central players. What the blockchain promises to do is to give you user agency, meaning user control. It's going to give more control to the user, to any consumer about their own identity. In the same way that your passport, you hold your passport. Nobody else will hold your passport for you. It is in in drawer and you use it when you go through airports. Why can we not have a digital equivalent of the passport that belongs to us only?

And that And we can activate it wherever we need to. But if we don't want to go somewhere, then we can leave. And And this is something that the blockchain has uh that Web 2 does not, the exit. Web 3, you just If you don't like your interaction or your your experience with a given service, you just disconnect your wallet or you disconnect your user identity, and you're gone. You're gone with your data. Try to disconnect yourself from a Web 2 uh type of service, whether it's Google or Facebook. They put you through the wringer. They'll make it very difficult for you to leave. It's usually buried somewhere in the user interface, and

you're lucky if you find it. And then you you have to answer many questions, and you don't know what they've done with your data because they've had your data. And then taking your data with you is very difficult. But with Web 3, with the blockchain, the promise is that it's your data, it's your identity. It belongs to you. And you take it, you bring it, you take it if you don't like it, and you move it along along, and maybe it's valuable. Maybe they ought to pay us instead of us paying them all the time because our data is valuable, our information is valuable, and that is the future. Well, as humans operate on incentive in that respect, uh this is going to be my final question for you here. As humans operate

on incentive, we also consider corporations. Perhaps they don't want to revoke these permissions. Perhaps they don't want to give that entitlement or the ability for an an individual user to have that power or that autonomy. What do you think it's going to take? Is it going to be an organic user demand in which it's going to be the power of the individual persons where they'll realize that this is the better way and that they want it this way? Or But is going to be that toppling stone because we don't have a corporation that's going to want to give this control. So, how is it that we're going to get there? Well, we need to see better use cases where the advantage of having your own data is visible.

And that will enable users to migrate and to go and try them out. At the same time, every time there is a hack, every time there is something bad that happens with within big companies where they are hacked and there is a data leak and somebody stole your data. That's painful. And usually users will will will will make a change if there is a pain. The users will will make a change if there is a pain, but they will not necessarily if there is a small gain.

So, the more that there is going to be a pain, the more of we see there is hacks, these central companies, there's a single point of failure. Unfortunately, they are the holders of the data. They are the holders of these data centers and something bad is going to happen. You can be sure that eventually something is going to I'm sure any of us have had these hacks happen. We've had an email from this company or this other company saying, "Oh, we've we've been hacked. Your data has been leaked. Change your password or whatever." And we have to be able to mitigate against that. And usually when something happens to somebody like that, they will leave. They will leave. But now right now, the alternatives are are not it's

not there. Where do we leave to? I mean, Google has got us really as prisoners. But we need to see more of these alternatives. So, if we can leave, actually today just an hour ago there was they were they were giving a lot of examples of Ethereum-based user agency types of sign on where you sign on with your own identity. But we want to see more places where I can take this identity that I have and sign on with it and do something with it. And this is lacking right now. But, that's the potential that's out there. We need to give these users these new choices so that when there is a pain, there is a gain.

I completely agree. William, I think I could have gone down this rabbit hole with you significantly more. I really appreciate your time today and thank you for joining me.